In November 2020, KPMG and the Canadian Construction Association conducted a survey of Canadian construction companies to gauge where they were in terms of adopting technology. The results recently published in a co-authored report entitled Construction in a Digital World, perhaps not surprisingly, were not great, despite the recognized potential software and technology have for improving construction project and business accountability, efficiency and profitability.
The team here at The Net Effect has reviewed the report. Below is a quick summary, our observations and recommendation for your reference.
KEY TAKEAWAYS FROM THIS REPORT
- Innovation in construction has lagged when it comes to digital adoption.
- Construction firms have had little incentive to invest in technology, but now is the time.
- The construction industry is on the cusp of a major change in the way business is conducted.
- Construction companies choosing to embrace technology will experience a serious competitive advantage in the future.
- Coordinated internal data management and streamlining information exchange with external parties will be key factors for efficiency, growth and profitability.
CONSTRUCTION COMPANIES RATE THEIR DIGITAL MATURITY AS FAIRLY LOW
- 25% of construction companies say they are ahead of their competition in digital maturity.
- 68% of construction companies are using cloud-based construction software solutions from a moderate to great extent.
GET THE RIGHT PEOPLE
- CEOs are the tech investment decision makers 41% of the time.
- Almost 60% of construction companies state they need to do a better job at adapting their digital strategy.
- It is critical to hire/engage leaders who know how to implement technology.
- Technology must be directly and continuously linked to the company’s objectives and processes.
- A successful digital strategy needs executive sponsorship, financial commitment, engagement and integration with the business, a leader who has the authority to act, as well as the talent to both lead and implement a technological transformation.
- Small and medium-sized companies can consider partnering with specialized construction software consulting firms to give them access to a broader range of expertise and help drive their transformation.
WHY COMPANIES ARE INVESTING AND WHAT THEY ARE INVESTING IN
- Construction companies commonly invest in technologies that will:
- Integrate systems to reduce redundancy
- Improve back-office support
- Reduce back-office costs
- Improve employee and customer experiences
- Construction firms need to also explore technologies designed to help improve productivity and safety, reduce lead time and reduce the cost of goods sold.
- During COVID, the 30% of construction companies who had implemented cloud-based technology saw significant benefits.
- Half of the remaining 70% (35%) are now planning or considering implementing SaaS construction software systems.
- As the economy begins to recover, there will be an opportunity for firms to seize an early competitive advantage by considering digital transformation.
- Digital innovation is a continuing process and now is a good time to build a roadmap to prioritize the integration of technology.
- Construction firms need to come together with other industry players, such as engineers, owners, suppliers and technology companies to optimize the benefits of implementing software.
- Connecting the broader ecosystem will drive more opportunities and help the industry embrace innovation faster.
BUILDING AND UPSKILLING A DIGITAL TEAM
- Investment in digital technologies requires teams who can make it happen because they understand the benefits of technology.
- The ideal way to effect a transformation is to build a new, separate digital team to lead it . . . and empower it to challenge traditional internal thinking.
- Building a separate digital transformation group can also help to attract younger, more digitally savvy team members.
- People who grew up in the digital age will grow increasingly reluctant to work for companies which don’t make optimal use of technology.
- Upskilling current employees is critical, so they continue to feel secure and buy into their new role within the changed organization.
- 66% of construction companies don’t feel they possess the necessary skills to undergo a digital transformation.
- Investing in digital technologies requires an investment in processes, particularly surrounding risk assessment and security.
- 66% of companies are moderately or considerably concerned about privacy breaches and potential risks associated with private data.
WHY ARE YOU WAITING?
- The companies who embrace technology and integrate it into their production will be the ones getting ahead.
- Unfortunately, companies often implement a technology concept to reduce costs or get a quick payback on a single project, only to leave the tool with the project and never use it again.
- Get the right people to the table and build a digital strategy extending to all key areas of your business.
- The tremendous benefits of integrated strategic digitization will become obvious, leaving management to wonder why they took so long.
THE FUTURE IS HERE – EMBRACE IT!
- The companies coming out ahead will be those who don’t wait.
- Develop a vision, hire a team, and get started!
- This digital evolution will enable efficiency gains, generate substantial enhancements in productivity, disrupt the workforce and modernize operating models.
- It’s time to embrace innovation.
Do you want to understand how you can get ahead of your competitors and take advantage of the many benefits of construction software? Our team is here to help you navigate the growing SaaS construction software ecosystem and map appropriate technologies to address your business challenges and needs. Feel free to request a free construction business needs analysis or schedule some time to chat with us.